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Premier Dalton McGuinty is in for a bumpy ride in northern Ontario this weekend in spite of his attempts to smooth over the budget crisis that pushed the province to the brink of an election, critics say.

Now that the budget has passed and an election is averted, McGuinty will have to appease northerners who are angry that he's privatizing Ontario Northland rail service after promising not to do so, the New Democrats say.

He'll also have to explain why his budget doesn't do much to create jobs in the north, which has lost 9,000 jobs since the Oct. 6 election and where the unemployment rate is the highest in the province at 10.4 per cent, said the Progressive Conservatives.

'There were a few little hiccups towards the end, but as I like to say, all's well that ends well.'—Dalton McGuinty on the budget standoff

"The premier is here in northern Ontario where this budget did absolutely nothing for the 60 mills that are closed, the 10,000 resource-sector jobs that we lost, the skyrocketing hydro rates that caused Xstrata Copper to move from Timmins to Quebec and shed 670 jobs in a community of 45,000," said Vic Fedeli, the PC energy critic.

But McGuinty was upbeat Friday as while visiting the site of a new Vale project in Sudbury, where the Liberals are gathering for a weekend conference.

The north's natural resource boom is the envy of the world and will bring jobs and prosperity to the region, he said.

"I wish we had a few more Sudburys around the province," McGuinty said. "Frankly, you're doing so well and experiencing so much growth. So we'll ask ourselves what can we learn from the examples that are right in front of our eyes here in Sudbury."

But he shifted to a more defensive stance when faced with pointed questions about Ontario Northland, and whether he planned to privatize any transit systems in southern Ontario.

"I know that it's human nature to make an immediate comparison, but I would argue that's kind of an apples-to-oranges comparison when you take a look at the cost per traveller," he said.

Ontario Northland's losses have only grown since he formed government in 2003, and that's just not sustainable when the province is facing a $15-billion deficit, he explained.

"In an ideal world we might be able to keep doing that," he said. "But we don't live in that world, we live in this world. And people are saying, 'Make sure that you build more spaces for our kids in colleges and universities, make sure we continue to invest in more homecare and long-term beds.' "

McGuinty proud of budget

McGuinty acknowledged the budget will loom large at the Liberal meeting, but said he's very "proud" of the result, which required major concessions to the New Democrats including hiking taxes for the wealthy.

"We lead a minority government, and with that, we have a heavy responsibility to find common ground with the opposition parties," he said. "And we were able to do that — move this budget through ultimately."

His comments were a far cry from a week ago, when the premier was on the attack over the opposition parties' changes to the budget and was threatening to go to the polls rather than vote on a drastically altered fiscal plan.

McGuinty accused the NDP of breaking their word to allow the budget to pass and teaming up with the Tories to "gut" the bill.

On Friday, the premier downplayed the conflict as rather trivial — an almost whiplash-inducing change from the outrage he displayed just a week ago.

"There were a few little hiccups towards the end, but as I like to say, all's well that ends well," McGuinty said. "People ask me, who won in all of this exercise? I think the answer to that is clear: Ontarians won."

Liberals will discuss 'how minority governments work'

When it comes to working with the other parties, there is room for improvement, he said. Making sure his party "understands how minority governments work" is something else they'll be discussing this weekend.

"It is absolutely necessary that we extend our hand to the opposition parties and it will be, no doubt, a bit more difficult the next time," McGuinty said. "So we'll have to begin sooner to establish links with the other parties."

The premier has already publicly reached out to the Tories, presumably to gain their support on wage and contract arbitration changes that were removed from the budget bill, but will be re-introduced this fall.

The Tories say they're open to talks, but they want the legislation to go further than what the Liberals presented in the budget to ensure arbitrators take into account what employers can afford to pay public sector workers.

But the next election won't be far from McGuinty's mind this weekend, as the party launches a new campaign to reach out to the rural ridings they lost last fall.

Former MPP Lou Rinaldi will be leading the effort to re-connect the party with its traditional rural roots, which include sending cabinet ministers more often to those ridings.

The Liberals will have a rude awakening, not only from angry voters, but from their own party volunteers, Fedeli said. They've devastated the horse racing industry by scrapping a slot machine revenue-sharing plan with racetracks and frustrated farmers who are fighting wind turbines,

"They are going to be shocked at what rural Ontario tells them," he said.

"They'll send them turning on their heels and send them home. They have done everything possible to harm northern and rural Ontario."